Startup takes aim at IBM's mainframe gravy train

A Swiss startup is aiming to take a big bite out of IBM’s cash-cow mainframe business by offering CIOs a potentially lower-cost and open alternative. If Lz Labs lives up to its promise this could be the biggest thing to happen to the staid world of mainframe computing for many years.

At the Cebit exhibiton in Hannover, Germany today Lz today unveiled what it calls the ‘Software-Defined Mainframe’: a way to run mainframe software on a commodity x86 server running Red Hat Linux or in the Microsoft Azure cloud. Both those companies announced partnerships with Lz.

Lz says it has created container software to run mainframe online, batch, database and other services without the need for mainframe hardware or any rewriting of code. If it is successful the company could make a huge difference to the way large enterprises conduct business as, although considered a datacentre dinosaur by some, the mainframe still accounts for a substantial percentage of the world’s most critical processes and transactions. One analyst recently estimated that mainframes generate about a fifth of IBM’s pre-tax profits.

Lz CEO Mark Cresswell said the potential market the company is addressing is worth billions of dollars to companies like IBM, BMC, Compuware and CA.

“If you look at the mainframe market as it stands, that market sustains several very, very large independent software vendors in addition to IBM,” he added.

IBM’s largest customers pay vast sums to the company to run mainframe services. In its stead, Lz will ask for an annual subscription when it releases its first service. Lz is not saying when that will be and declined to name trial customers.

“Being a Swiss company the best thing we can say is we’re in clinical trials,” said Lz chairman Thilo Rockmann.

Despite the Red Hat and Microsoft partnerships, Lz’s Cresswell denied that there was any concerted attempt to displace IBM.

“None of the folks we have spoken to have fixated on a ‘kill IBM’ strategy – there’s no strategic circling of wagons,” he said.

As well as saving money and gaining in flexibility, Cresswell said that customers will also benefit from the continued performance improvements of Intel and Intel-compatible processors.

“In raw horsepower terms a mainframe is not all that powerful platform. Intel has benefited from the inexorable march of Moore’s Law,” he added.